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A firm has daily cash receipts of $100,000. A bank has offered to reduce the collection time on the firm's deposits by two days for a monthly fee of $500. If money market rates are expected to average 6 percent during the year, the net annual benefit (loss) from having this service is:
Suggested Answer: C
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Choice 'c' is correct. $6,000 net annual benefit from using a lockbox system.
9 comments · newest first
PR
Precious
11 months ago
Totally agree, $6,000 sounds right!
FA
Fannie
12 months ago
Wait, how does that even add up?
ME
Meaghan
12 months ago
I think the net benefit is $6,000.
KR
Kristeen
12 months ago
That fee seems low for a 2-day reduction!
JO
Joanne
1 year ago
Daily cash receipts are $100,000.
FR
Franchesca
1 year ago
Ah, I think I know what's going on. The post_max_size setting is probably too low, which would prevent the file from being uploaded. I'll make sure to check that.
NO
Novella
1 year ago
Okay, I think I've got this. Mentoring is all about personal and professional development, so I'm going to go with option A. It strengthens an individual's self-development, which seems like the most direct benefit.
OT
Otis
1 year ago
Hmm, I'm a bit unsure about this one. The options seem to cover different aspects of a job worth hierarchy, but I'm not totally clear on how they all fit together. I'll have to think this through carefully.
LA
Launa
1 year ago
This is a tricky one. I'm tempted to go with a slightly more conservative option like A, but I don't want to overcommit either. I'll need to carefully weigh the trade-offs before making a decision.